The regulator said MSB records, ledgers, books and documents—including those in electronic media—should be maintained and safely stored for five years from the date of transaction; have hard and/or soft backup copy to allow reconstruction of records in case of loss or destruction due to fire and other fortuitous events; and be made available for BSP examination upon request, it added.

“Refusal to permit examination shall include any act of refusing to present the pertinent MSB’s record upon request by any duly authorized BSP officer/examiner. These may include, but not limited to the following actions or inactions: (1) refusal to permit access to its records, ledgers, registers, books or documents; (ii) failure to submit the requested documents, and (iii) delay of MSBs in the submission of information, data and documents without justifiable reasons and explanation,” it said.

MSB boards and owners, meanwhile, were ordered to establish written internal policies and procedures commensurate to the size and complexity of business operations.

MSBs are expected to maintain an operations manual that shall include: standard operating procedures for the conduct of money service operations; policies and procedures of the remittance and transfer companies on the accreditation and delisting of sub-agents; mechanisms on handling consumer complaints; policies on branch/sub-agents oversight; and policies on the recruitment, selection and retention of employees.

“The MSBs shall adopt adequate and effective internal control measures to safeguard the assets of the MSB,” it added.

There should be proper segregation of duties and functions for critical operational functions; and no individual should have complete authority and responsibility for handling all phases of any transaction from beginning to end, without some check or balance from some part of the organization.

“The work of one employee is to be verified by a second employee to ensure that the transactions is properly authorized, recorded and settled (i.e. dual control). The routine and completion of each transaction shall involve at least two employees,” the BSP added.

Adequate controls/measures should also be in place to protect key information and records, and also cash on hand.

Minimum internal control procedures should ensure that all foreign exchange transactions shall be supported by applications to sell/purchase foreign currency; the amount of foreign currencies sold should be indicated in the corresponding official receipts, both in words and in figures; daily records of foreign exchange transactions should be maintained and all foreign exchange sale and purchase transactions shall be posted chronologically; and copies of cancelled receipts shall be marked and stamped “CANCELLED”, the BSP said.